Papua New Guinea: Ok Tedi mine disaster fund at the centre of another legal battle
Author: Nick Toscano, The Sunday Morning Herald, Published on: 6 November 2019
"PNG's Ok Tedi mine disaster money locked in new legal fight", 3 November 2019
A fresh dispute has erupted over control of a fund set up to benefit the tens of thousands of villagers affected by mining giant BHP’s environmental disaster at the Ok Tedi mine in Papa New Guinea more than 20 years ago. [BHP] co-owned [the mine] with the PNG government,…discharg[ing] tens of millions of tonnes of mine waste into the local river…during the 1980s and 1990s, contaminating fish and trees…devastating the area’s economy.
A special trust account was created by the mine owners…to accumulate dividends from the Ok Tedi…profits to compensate the 30,000 landowners of the worst-affected communities. Estimated to contain 250 million kina ($106 million), the Western Province People's Dividend Trust Fund had been managed by PNG government. [T]he Ok Tedi and Fly River Development Foundation…raised allegations the funds were being "misapplied ... causing a diminishment" and won a legal bid to become its trustees. The newly-formed foundation claim[s] to represent…residents of the villages most immediately impacted. [But]…the PNG government,…last month, obtain[ed] further court orders blocking the ANZ Bank from dispensing funds. The [Foundation] has applied to have the injunction set aside...The case will be heard in…December. An ANZ spokesman said it would be inappropriate to comment...
[In] 2002, [BHP] transferr[ed] its 52 per cent equity stake to a development fund…for the benefit of PNG residents,…[using] dividend payments from BHP’s transferred shareholding in Ok Tedi to finance long-term sustainable development projects…[BHP] also reached an out-of-court settlement with 30,000 landowners…in 1996, which included $110 million in compensation for the affected villagers.
Related companies: BHP (formerly BHP Billiton)